ACW2020 Aniza Zainol Page 1 of 10 OFFICE USE ONLY ACW2020 COST INFORMATION FOR DECISION MAKING Question 1 (20 marks) (a) Describe the inventory accounts that are used to keep track of the cost flows in a manufacturing firm. (b) What is activity-based costing, and
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customer usefulness is added to products or services. In supporting managers, management accountants have three guidelines. These guidelines are: Cost-benefit analysis, behavioral considerations and technical considerations, and different costs for different purposes. Galway Co. management desires cost information regarding its Celtic brand. The Celtic brand is a(n) cost object. Cost objects are anything for which a measurement of cost is desired The cost of a product can be measured as any of the
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F____ 1. A specific product cannot be a cost object. T____ 2. If the cost of an additive is $5,000 + $0.50 for every unit of solvent produced, the cost is classified as a mixed cost. _F___ 3. A variable cost will be an effective cost driver. _T___ 4. Retailers generally have a much lower degree of conversion than do manufacturing or professional firms. __F__ 5. In a service industry, direct materials are usually significant in amount and can be easily traced to a cost object. F____
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of the leading consumer product organizations that have been dealing its products in worldwide. Colgate- Palmolive is an America based company and has many branches all over the world. One of the branches is located in Malaysia. Colgate- Palmolive (M) Sdn Bhd focusing their product segment on toothpaste and toothbrush. Both products are very competitive presently in Malaysia market. At the present, Colgate is implementing Activity-Based Costing (ABC) method. ABC is a system had been practices in many
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1. Cost accounting relates to what industry? a. public accounting b. financial accounting c. service d. manufacturing 2.Sunk costs are ______. a. future costs b. costs that do not affect the decision c. costs from the past and cannot be changed. d. choice b & c are both correct 3.Which is not a characteristic of managerial accounting information? a. Emphasizes the external financial statements b. Emphasizes relevance c. Provides detailed information about individual parts of the company
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manufacturer that has been struggling with a number of strategic issues facing a capital-intensive, mature industry. Their product costing system was inadequate to provide management with relevant information for decision making. Therefore, the board of directors has approved your consulting company’s proposal to conduct a cost system pilot study. Besides showing an analysis of FHPC’s product cost, your report to the board of directors is to include strategic recommendations based on your findings
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INTRODUCTION OF TARGET COSTING Target costing is a system of profit planning and cost management. The required features and performance of the proposed product are established. Then target costing determines the life cycle cost at which the product must be produced, to generate the firm’s desired level of profit. Given the product’s anticipated selling price (Cooper and Slagmulder,1999, p.166). Note that target costing is not a method for product costing , it is a technique for cost management.
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CHAPTER 5 Activity-Based Management Chapter Outline A. Cost Management Challenges — Chapter 5 presents three questions to be answered in this chapter. 1. Is activity-based costing (ABC) enough by itself to improve efficiency? Can cost managers ensure that an organization will meet its efficiency goals merely by measuring costs more accurately by using ABC? 2. Does the cost manager’s responsibility end with making recommendations for improvements? Are the
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Ma’am Rafia Ayub of Cost Accounting, for giving us such a unique project. CHAPTER O5: CLASSIFICATION OF COST Cost can be classified into two categories i.e. product cost and period cost. 5.1.1 Product cost Product cost includes; • Direct material • Direct labor • Factory overheads All elements of product cost are already stated above. 5.1.2 Period cost It consists of all the cost related to Marketing, Selling and Administrative
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you set up a small manufacturing unit, say manufacturing of packing boxes, a problem will arise what price of each box you should quote to the buyer. Many factors are considered while fixing the price of a product/item such as competitors’ price etc. One of the basic factors is the cost of its production. Cost is essential not only to fix price but also to ascertain the margin of profit. Knowledge of the cost determination is also necessary to keep a check on the cost of product/control on wastages
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